Toyota investing $819m in Didi, new joint venture

SHANGHAI • Toyota Motor Corp said yesterday that it will invest US$600 million (S$819 million) in Chinese ride-hailing giant Didi Chuxing as well as in a new joint venture as the two companies seek to develop connected and electric vehicle technologies in China.

The move accelerates a trend in China that has seen carmakers launch their own ride-hailing services, and ride-hailing firms such as Didi team up with car manufacturers to develop purpose-built vehicles for their services.

It also comes as the car and communications industries develop the next generation of connected vehicle technologies, including self-driving and so-called vehicle-to-everything technology, with the advancement of 5G network technology.

Toyota said the new joint venture would include its Chinese partnership with Guangzhou Automobile Group, and would see the companies combining services and technologies to work on fleet management, car maintenance and car rental services.

That collaboration will utilise Toyota's connected technologies and next-generation battery electric vehicles, Toyota executive vice-president Shigeki Tomoyama said.

Toyota, which says it aims to get half of its global sales from electrified vehicles by 2025, has tapped Chinese battery makers such as Contemporary Amperex Technology and BYD to aid it in the shift to electricity-powered cars. The move is in line with global regulations and a push among carmakers to develop the new-energy vehicle industry.

It has also said it will set up a joint venture to develop connected vehicles with Japanese car parts maker Denso Corp.

In their announcements yesterday, Toyota and Didi did not specify whether their collaboration will involve car design or manufacturing, which is part of Didi's goal to ultimately develop purpose-built cars for its services.

The two firms had previously teamed up on other vehicle projects and services for Didi drivers.

Sources told Reuters last month that Didi was in talks with Nissan Motor and its China partner, Dongfeng Automobile, to form another fleet-management venture.

A source familiar with the matter also told Reuters that Chinese electric-vehicle maker Lixiang, previously known as CHJ, is working with Didi to build a car model for mobility services.

REUTERS

A version of this article appeared in the print edition of The Straits Times on July 26, 2019, with the headline 'Toyota investing $819m in Didi, new joint venture'. Print Edition | Subscribe